$USDC The Clash of Politics and Finance: How the Trump Family's Stablecoin Disrupts Legislative Games?

Written by: Yueqi Yang

Compiled by: Block Unicorn

Congress is rapidly advancing new cryptocurrency legislation that could give stablecoins a more significant role in the financial system, putting banks in a passive position even before President Trump entered the fray.

Trump stated he hopes stablecoin rules will be a key focus of his government's cryptocurrency legislation. Caught off guard, banks have begun to intensify their lobbying efforts to push for significant changes to regulations, ranging from who can issue stablecoins to how stablecoins are designed, in order to maintain their position in the financial system.

As banks and crypto companies grapple for influence over regulations, Trump has launched his own stablecoin, directly threatening businesses in both sectors.

Unlike more well-known crypto assets like Bitcoin, stablecoins do not experience price volatility and are typically pegged to the dollar. They serve a similar purpose to money market funds, allowing for cash storage and easy cross-border transfers. The current stablecoin market has soared to $230 billion, with Tether and Circle's USDC dominating at $145 billion and $60 billion, respectively.

The latest entrants are the Trump family. Last week, the crypto project "World Liberty Financial," founded by Trump and his sons, announced the launch of its own stablecoin USD1. This has raised concerns that Trump may push for legislation that benefits his business.

Congress Advances Stablecoin Legislation

Congress is accelerating the push for stablecoin legislation. On Wednesday, the House Financial Services Committee plans to vote on a stablecoin bill to decide whether to send it to the full House. A similar bill was passed earlier this month by the Senate Banking Committee. Trump hopes the bill will pass before August, and it has already garnered some support from Democrats.

Stablecoin legislation could threaten banks' positions in the financial system.